The following transactions occurred in April at Steve's Cabinets, a custom cabinetry firm: Purchased $23,500 of materials
Question:
The following transactions occurred in April at Steve's Cabinets, a custom cabinetry firm:
Purchased $23,500 of materials on account.
Issued $1,550 of supplies from material inventory.
Purchased $12,700 of materials on account.
You paid for the materials purchased in the transaction (1) using cash.
Issued $15,100 in direct materials to the production department.
Incurred direct labor costs of $27,500, which were credited to Wages Payable.
He paid $22,700 in cash for utilities, power, equipment maintenance, and other sundries for the manufacturing plant.
Overhead applied based on 125 percent of direct labor costs of $27,500.
Depreciation recognized on manufacturing property, plant and equipment of $11,500.
The following balances appeared in Steve's cabinet accounts for April:
Beginning | Finishing | |||||
Materials inventory | ps | 31,890 | ? | |||
inventory in progress | 8,100 | ? | ||||
Finished Goods Inventory | 34,700 | ps | 29,390 | |||
cost of goods sold | 54,930 | |||||
b. Prepare T-accounts to show the flow of costs over the period from materials inventory to cost of goods sold.
Fundamentals of Cost Accounting
ISBN: 978-1259565403
5th edition
Authors: William Lanen, Shannon Anderson, Michael Maher